Teck’s Controlling Shareholder Says He’s Open to Deals After Planned Split

(Bloomberg) — Teck Resources Ltd.’s controlling shareholder has given his clearest indication yet that the company will be up for sale, but only if investors throw their support behind a plan to split the Canadian miner in half.

Most Read from Bloomberg

Norman Keevil, the 85-year-old magnate who controls Teck through “supervoting” Class A shares, offered investors the prospect of a future deal as the company scrambles to win over investors in the face of a competing proposal from Glencore Plc.

Glencore’s $23 billion offer — to merge the businesses and then create two new companies that mine metal and coal respectively — gained traction toward the end of last week, putting Teck on the back foot. Two influential investor advisory groups came out against Teck’s plan, while Bloomberg reported on Friday that Teck’s largest investor, China Investment Corp., currently favors Glencore’s proposal.

Teck investors will vote on the plan to spin off its coal mines in a little more than a week, and Glencore Chief Executive Officer Gary Nagle has said that the company will keep pursuing a deal if Teck’s investors vote down the restructuring plan.

The Canadian company will be hoping that the chance of a sale or bidding war after the split will convince shareholders it is a better prospect than the Glencore proposal.

“I would support a transaction – whether it be an operating partnership, merger, acquisition, or sale – with the right partner, on the right terms for Teck Metals after separation,” Keevil said in a commentary issued by Teck.

Teck’s copper and zinc mines have long been admired by the world’s biggest miners, but Keevil’s resistance to sell has kept the company independent so far. Freeport McMoRan Inc., Vale SA and Anglo American Plc have expressed interest in speaking with Teck about its base metals business, should Teck’s plan for a spin-off go ahead as planned.

But the company first needs investor backing for the split, with shareholders poised to vote on April 26. The restructuring plan will require two-thirds approval from the holders of both classes of shareholders, which means that Keevil can’t use his Class A voting powers to force the proposal through.

Teck’s board has rejected two takeover proposals from Glencore this month, most recently after the company offered to add a cash component to buy Teck shareholders out of their exposure to the combined coal businesses.

“I believe that pursuing a sale or merger transaction now would rob our shareholders of significant post-separation value,” Keevil said. “Glencore’s proposal is the wrong one, as well as at the wrong time.”

(Updates with details throughout)